Page 31 - ISCDEBK-12

Partnership Accounts—Fundamentals 1.21

Solution: PROFIT AND LOSS APPROPRIATION ACCOUNT
Dr. for the year ended 31st March, 2020 Cr.
Particulars ` Particulars `
To Interest on Capital A/cs (WN 1): By Profit and Loss A/c (Net Profit) 70,000
Sachin 18,500 By Interest on Drawings A/cs (WN 2):
Saurabh 11,250 29,750 Sachin 1,200
To Share of Profit trfd. to Current A/cs: Saurabh 783 1,983
Sachin 25,340
Saurabh 16,893 42,233
71,983 71,983
Dr. PARTNERS’ CAPITAL ACCOUNTS Cr.
Date Particulars Sachin Saurabh Date Particulars Sachin Saurabh
` ` ` `
2019 2019
Oct. 1 To Furniture A/c 40,000 ... April 1 By Balance b/d 2,00,000 1,00,000
2020 Oct. 1 By Furniture A/c ... 25,000
Mar. 31 To Balance c/d 1,80,000 1,25,000 2020
Jan. 1 By Purchases A/c (Stock) 20,000 ...
2,20,000 1,25,000 2,20,000 1,25,000
Dr. PARTNERS’ CURRENT ACCOUNTS Cr.
Date Particulars Sachin Saurabh Date Particulars Sachin Saurabh
` ` ` `
2019 2019
July 1 To Bank A/c (Drawings) 10,000 8,000 April 1 By Balance b/d 50,000 20,000
2020 2020
Jan. 1 To Bank A/c (Drawings) 18,000 4,000 March 31 By Interest on Capital A/c 18,500 11,250
Feb. 1 To Purchases A/c 5,000 March 31 By Profit and Loss
(Goods Withdrawn) Appropriation A/c 25,340 16,893
March 31 To Interest on Drawings A/c 1,200 783 (Share of Profit)
March 31 To Balance c/d 64,640 30,360
93,840 48,143 93,840 48,143

Working Notes:
1. Interest on Capital: `
Sachin:
(i) On ` 2,00,000 for 6 months (1st April, 2019 to 30th September, 2019) @ 10% p.a. 10,000
(ii) On ` 1,60,000 for 3 months (1st October, 2019 to 31st December, 2019) @ 10% p.a. 4,000
(` 2,00,000 – ` 40,000 for furniture taken over)
(iii) On ` 1,80,000 for 3 months (1st January, 2020 to 31st March, 2020) @ 10% p.a. 4,500
(` 1,60,000 + ` 20,000 for stock introduced)
Total 18,500
Saurabh
(i) On ` 1,00,000 for 6 months (1st April, 2019 to 30th September, 2019) @ 10% p.a. 5,000
(ii) On ` 1,25,000 for 6 months (1st October, 2019 to 31st December, 2019) @ 10% p.a. 6,250
(` 1,00,000 + ` 25,000 for furniture introduced)
Total 11,250